Not every person is literate in financial terms, especially when it comes to managing money. Now, try to imagine situations where something happens to you and your nominee decides to invest all the money he has got from your term plan in one go. Let’s say, based on a friendly advice by a friend/family, he invests the money in a chit funds and eventually loses all the money. You wouldn’t want that to happen. That money is meant to take care of your family’s expenses when you are not around to take care of them and thus, needs to be managed well.